Rivian Automotive (NASDAQ: RIVN) stock plummeted after receiving a downgrade from UBS.
UBS has issued a downgrade to Rivian (RIVN) stock. The financial firm downgraded the EV maker’s rating from Buy to Sell, citing concerns over mixed fourth-quarter results and a disappointing outlook.
Rivian (RIVN) reported mixed financial results for the fourth quarter earlier this week. The company outperformed revenue projections in the fourth quarter, raking in $1.32 billion, beating estimates of $1.26 billion. However, the company reported a loss of $1.36 per share, slightly more than the expected $1.32 loss.
Rivian also disclosed plans for a 10% reduction in its salaried workforce. This decision aims to bolster financial health and streamline operations moving forward.
Rivian had previously disclosed production figures, stating that it manufactured 17,541 vehicles in the fourth quarter and delivered 13,972 during the same period. For fiscal year 2023, the company produced 57,232 and handed over 50,122.
Rivian CEO RJ Scaringe said,
“We made great progress in 2023 despite economic headwinds, and we’re excited about the year ahead. We firmly believe in the full electrification of the automotive industry but recognize in the short-term, the challenging macro-economic conditions.”
The company’s cash and cash equivalents stood at $9.37 billion by the end of the quarter, with total liquidity at $10.47 billion, including an asset-based revolving credit facility.
Rivian Outlook
Looking ahead to fiscal 2024, Rivian aims to enhance cost efficiency and build upon the progress achieved in 2023, focusing on increasing gross profit per delivered vehicle.
The company said,
“Economic and geopolitical uncertainties and pressures, most notably the impact of historically high interest rates, have informed Rivian’s expectations for 2024.”
The company expects to produce 57,000 vehicles in 2024, aligning with the previous year’s production levels. However, it forecasts an adjusted EBITDA loss of $2.7 billion for the year.
Rivian will unveil its new model, the Rivian R2, on March 7.
Scaringe said,
“We are aggressively focused on driving cost efficiency throughout the business, achieving positive margins and building our go-to-market function to support our long-term growth.”
Rivian (NASDAQ: RIVN) Stock Performance
RIVN stock plunged 12.05% to close at $10.07 on Friday. The traders had exchanged hands with 122,970,805 (122.97 million) shares compared to the average daily trading volume of 36.43 million.
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